He says he is committed to turning Falcon 9 into “the first fully and rapidly reusable rocket” because, he says, that accomplishment is key to making spaceflight affordable and routine. To cut the cost of getting to orbit to just $100 per pound, Musk says, “you need to be able to launch multiple times a day, just like an airplane. And it’s got to be complete, so you can’t be throwing away a million dollars of expendable hardware every flight either.” Musk has targeted reusability from the start. Merlin engines, for example, are designed to fly tens of missions—provided you can get them back. An animation on SpaceX’s Web site shows how that might happen: Cast-off Falcon 9 stages reenter the atmosphere at between 17 and 25 times the speed of sound, then use their own guidance systems and engines to fly back to the launch site, where they land upright on deployable legs. A test program called Grasshopper is already in the works at SpaceX’s Texas facility. No one can predict how many years it might take to achieve full and rapid reusability, but Musk says, “it’s absolutely crucial. It’s fundamental. I would consider SpaceX to have failed if we do not succeed in that.”The insistence on reusability “drives the engineers insane,” says Vozoff. “We could’ve had Falcon 1 in orbit two years earlier than we did if Elon had just given up on first stage reusability. The qualification for the Merlin engine was far outside of what was necessary, unless you plan to recover it and reuse it. And so the engineers are frustrated because this isn’t the quickest means to the end. But Elon has this bigger picture in mind. And he forces them to do what’s hard. And I admire that about him.”

_________________Single-stage-to-orbit was already shown possible 50 years ago with the Titan II first stage. Contrary to popular belief, SSTO's in fact are actually easy. Just use the most efficient engines and stages at the same time, and the result will automatically be SSTO.Blog: http://exoscientist.blogspot.com

Anyway: from what people have noticed about the specs given for Stratolaunch and what is seen in the animation (dragon sits on top, so diameter equals Falcon 9) it looks like this will be a shortened F9 first stage (because of the fuel savings from airlaunch and using vacuum optimized nozzles for higher ISP) with only 4 or 5 engines because less thrust is needed.

Guess with all that you can "easily" reduce the F9 to 500k lbs air launched version.

December 8, 2011, marked the one-year anniversary of Dragon’s first Commercial Orbital Transportation Services (COTS) demonstration flight. The flight made history, as SpaceX became the only commercial company to successfully return a spacecraft from orbit. This feat had previously been accomplished only by five nations and the European Space Agency.

We are now preparing the Dragon spacecraft for yet another historic flight -- becoming the first commercial vehicle in history to visit the International Space Station (ISS)!

NASA recently announced February 7, 2012, as our new target launch date for the upcoming mission. In addition, NASA officially confirmed that SpaceX will be allowed to complete the objectives of COTS 2 and COTS 3 in a single mission.

This means Dragon will perform all of the COTS 2 mission objectives, which include numerous operations in the vicinity of the ISS, and will then perform the COTS 3 objectives. These include approach, berthing with the ISS, astronauts opening Dragon and unloading cargo, and finally astronauts closing the spacecraft and sending it back to Earth for recovery from the Pacific Ocean off the coast of California.

This mission marks a major milestone in American spaceflight. While our first missions to the ISS will be to transport cargo, both Falcon 9 and Dragon were designed to ultimately transport astronauts. Every trip we make to the ISS from this point forward gets us closer to that goal. SpaceX is incredibly excited for what the future holds and, as always, we greatly appreciate NASA’s continued support and partnership in this process.

THE COTS 2/3 DEMONSTRATION MISSION

Just as Dragon’s first mission to orbit and back involved a level of effort equal to launching the first Falcon 9, preparing Dragon for two weeks of operation in space and for approach and berthing with the ISS poses new challenges. Meeting them requires a large amount of detailed planning and careful execution.

Each launch day will have just one narrow liftoff window -- no more than a few minutes -- in order to synchronize Dragon’s flight with the orbit of the ISS. Catching up to the ISS will take from one to three days. Once there, Dragon will begin the COTS 2 demonstrations to show proper performance and control in the vicinity of the ISS, while remaining outside the Station’s safe zone.

During the entire time Dragon is in the vicinity of the ISS, Station astronauts will be in direct communication with Dragon and will be able to monitor the spacecraft as well as issue spacecraft commands.

After successfully completing the COTS 2 requirements, Dragon will receive approval to begin the COTS 3 activities, gradually approaching the ISS from the radial direction (toward the Earth), while under constant observation.

Dragon will approach to within a few meters of the ISS, allowing astronauts to reach out and grapple Dragon with the Station’s robotic arm and then maneuver it carefully into place. The entire process will take a few hours.

Once in place, Station astronauts will equalize the pressure between the ISS and Dragon, open the hatches, enter the vehicle and begin unloading Dragon’s cargo.

After Dragon spends about a week berthed at the ISS, astronauts will reverse the process, loading Dragon with cargo for return to Earth, sealing the hatches, and un-berthing the Dragon using the robotic arm.

Dragon will then depart from the ISS and return to Earth within a day or so, and the SpaceX recovery crew will meet it at splashdown in the Pacific Ocean off the coast of California.

PREPARING FOR LAUNCH AT THE CAPE

As previously reported, both the Falcon 9 launch vehicle and the Dragon spacecraft that will fly in the COTS Demo 2/3 mission have been delivered to our launch complex in Cape Canaveral, Florida. Falcon 9’s first stage, second stage, and interstage were integrated and rolled out for two separate wet dress rehearsals in which SpaceX engineers performed the entire countdown sequence up until the moment the engines would be fired.

The Dragon COTS Demo 2/3 spacecraft and trunk have also been delivered to our launch pad and are undergoing final processing for flight

Anyway: from what people have noticed about the specs given for Stratolaunch and what is seen in the animation (dragon sits on top, so diameter equals Falcon 9) it looks like this will be a shortened F9 first stage (because of the fuel savings from airlaunch and using vacuum optimized nozzles for higher ISP) with only 4 or 5 engines because less thrust is needed.

Guess with all that you can "easily" reduce the F9 to 500k lbs air launched version.

Certainly not, that was actually my first thought when I saw the animation. But just because it probably* will have 5 engines, doesn't mean it is the same thing as was originally planed to become Falcon 5.

I can't see SpaceX building another production line for this. They're going to have trouble enough scaling up their production facilities without building a third set of them, and they don't need this project from a financial perspective either. So the only way I see them do this is if they can do it at very low overhead...

_________________Say, can you feel the thunder in the air? Just like the moment ’fore it hits – then it’s everywhereWhat is this spell we’re under, do you care? The might to rise above it is now within your sphereMachinae Supremacy – Sid Icarus

I can't see SpaceX building another production line for this. They're going to have trouble enough scaling up their production facilities without building a third set of them, and they don't need this project from a financial perspective either. So the only way I see them do this is if they can do it at very low overhead...

But I cannot see the launch aircraft being ready within 5 years, so they have plenty of time to mod the rocket, and plenty of time means cheaper.

Musk's Mars plans or at least some cgi with a nice music track tho i do hope he makes it and if he can get it down to $100 to $200 per kilogram to Mars i think he may be able to find a way to raise the money needed to do so.